Annual Review 2017/18 Front cover Shortlisted entries of the International Coffee Day Photo Competition 2018, including the winning image by Mr Alejandro José Pernía Paredes, from Mérida, Venezuela.

ISSN 1473-3331 ICO Annual Review 2017/18

Contents

Highlights from the year 1 ICO and the Sustainable Coffee Challenge 37 ICO and the International Women’s Coffee Alliance 38 Our Mission 3 ICO and the Global Coffee Platform 39 Foreword by the Chair of Council 4 ICO and the African Fine Coffees Association 40 Coffee Global Adaptation Plan (C-GAP) 40 Message from the Executive Director 5 International Commodity Bodies’ Forum 41 Bi-lateral discussions with international organizations 42 International Coffee Council and associated meetings Industry events 43 7 121st Session: 7-12 April 2018 Mexico City, Mexico 7 Outreach 45 122nd Session: 17-21 September 2018 London, Library & Information 45 United Kingdom 8 Links with universities and schools 45 ICO Internship Programme 47 A forum for dialogue 11 Connecting with industry and consumers 47 Fostering gender equality in the coffee sector 13 Meet the intern 47 How digital technologies and new financing instruments can improve access to finance 14 International Coffee Day 2018 49 Promoting funding opportunities 15 International Coffee Agreement 2007 51 Sharing developments in coffee consumption and health 17 Bolivarian Republic of Venezuela 51 Learning lessons on Coffee Leaf Rust 18 China 51 Coffee development projects 19 Jamaica 51 Guide to Accessing Green and Climate Funding: The Global Engaging with Members 51 Environment Facility (GEF) 20 Members 53 Supporting a sustainable coffee sector in Uganda 21 Exporting Members - 44 (As at 30 September 2018) 54 Promoting domestic consumption 22 Importing Members - 7 (As at 30 September 2018) 54 Satellite remote sensing for improved and sustainable coffee production: Colombia 23 Finance & Administration 55 Monitoring implementation of Sustainable Development Governance and management 55 Goals 24 Introducing a thematic focus 55 Markets, statistics and economics 25 Resources 55 Monitoring the Programme of Activities through Key World Coffee Market 27 Performance Indicators 55 Improving ICO statistics 29 Country coffee profile 30 Looking ahead 55 Economic research 31 Gender equality in the coffee sector 31 Office holders 2017/18 56 Development of coffee trade flows 32 Organisational structure 58 Emerging coffee markets: South and East Asia 33 The role of the coffee futures market in discovering prices for Latin American producers 33 Economic and Policy Analysis for Improving Smallholder Coffee Producers’ Incomes 34 Promotion and Market Development 34

Partnering for impact 35 ICO Annual Review 2017/18

Highlights from the year

WORLD COFFEE PRODUCTION IN COFFEE YEAR 2017/18

163.5 million bags

4.8% higher than last year.

In collaboration with the Sustainable Coffee GUIDE TO ACCESS GREEN AND CLIMATE FUNDING FOR THE Challenge, the ICO published the Guide to COFFEE SECTOR The Global Environment Facility (GEF) Access Green and Climate Funding for the Coffee Sector

ICC-122-9 V.1.2

In cooperation with

ICO’S KEY ACTIVITIES FOR 2018/19

• Implementation of Resolution 465 on coffee price levels • Launch of first ICO Flagship Report focusing on economic sustainability.

1 Highlights from the year

ICO MEMBERS

World coffee consumption 98% is estimated at of world coffee 161.93 million bags production in 2017/18. 2/3 of world coffee 1.8% higher than in 2016/17 consumption

Closing the gender gap could unlock an increase in coffee production of 4 to 6.5 million 60-kg bags to meet future global demand.

Now in its fourth year, International Coffee Day 2018 celebrated the growing importance of women across the coffee value chain.

In coffee year 2017/18, the composite indicator price COFFEE PRICES IN 2017/18 averaged 111.51 US cents/lb, 15.8% lower than the average of 132.43 US cents/lb in 2016/17.

15.8% This sustained downward trend in coffee prices has lower than in 2016/17 been a great concern to the ICO and the world coffee sector over the past year.

2 ICO Annual Review 2017/18

Our Mission

The International Coffee Organization (ICO) is a multilateral organization, which works through international cooperation to strengthen the global coffee sector and promote its sustainable development in economic, social and environmental terms.

We were set up in 1963 under the auspices of the Our Member Governments represent 98% of the United Nations, with responsibility for implementing world’s coffee production and over two-thirds of the International Coffee Agreement (ICA) – an world consumption, providing a unique forum for important instrument for development cooperation the global coffee community. Our Members regularly and trade. The latest Agreement, ICA 2007, entered discuss and decide the ICO’s guiding principles, into force in 2011. strategy and work programme in line with the 2030 Sustainable Development Agenda.

Our Strategic Focus Is On:

Delivering world-class data, analysis and information to policy-makers and the industry

Providing a global forum for dialogue between and within the public and private sectors

Facilitating development projects and promotion programmes through public-private partnerships

3 ICO Annual Review 2017/18

Foreword by the Chair of Council

I was greatly honoured to serve as Chair of the As Members of the ICO we all have a duty to ensure International Coffee Council during coffee year the Agreement is fulfilled and must support the 2017/18. We have yet again witnessed a year of ICO in its role as administrator of the Agreement, challenges for the global coffee community and the not only for the consumers across the world, but operation of the International Coffee Organization most importantly for the 120 million people whose (ICO), but throughout I have always believed in and livelihood depends on coffee. It was with regret, championed the power of collaboration. therefore, that Members received notification this I come from a coffee tradition, which served year of the decision of the United States of America to inspire me in my function as Chair. During my to withdraw from the ICA 2007. I firmly believe that tenure I had the pleasure to chair the 121st Session we need to work together and mobilize our resources of the International Coffee Council in Mexico City in order to ensure a sustainable global coffee sector. and the 122nd Session in London, providing not This is why I was proud to lead a high-level delegation only a valuable forum for the international coffee to Washington in June calling on the United States community to come together to discuss and explore Government to reconsider its decision, and look how to address the multiple challenges facing today’s forward to welcoming back our American friends to sector, but also the great opportunities offered by the global coffee family as soon as possible. producing, trading, processing and consuming coffee. We live in a rapidly changing world, and the Eighty percent of the world’s coffee is produced world of coffee is no exception. For this reason, the by small-scale growers in Africa, Asia and Latin sector has to adapt, and that includes the ICO. I America and the major challenge overshadowing am heartened to see that the ICO has continued to this coffee year has been the dramatic impact of low innovate its work practices and open itself up to coffee prices, which do not allow many coffee growers wider collaboration with global partners, to ensure to cover their production costs, thus compromising it is an effective, efficient and relevant Organization their economic sustainability and jeopardizing future responding to the needs of its Members and all availability from important origins. The recognition stakeholders in the coffee value chain. that the global coffee community needed to act was I would like to take this opportunity to thank my manifested in Resolution 465 on coffee price levels, fellow Members of the ICO for their hard work and approved during the Council´s 122nd Session, which commitment over the coffee year, as well as thank gave the ICO a strong mandate to actively promote the ICO Secretariat for their support and dedication a dialogue and engage all stakeholders in the coffee to the work of the Organization. value chain to find common solutions addressing the Finally, I wish the incoming Chair, Ms Stefanie economic sustainability of the coffee producers. The Kűng of Switzerland, every success in the next ICO is already actively implementing this Resolution coffee year. Through the power of collaboration, I am and I am confident that together we can overcome convinced the global coffee sector has a bright future. the many challenges involved and find long-lasting solutions. The International Coffee Agreement (ICA) 2007 H.E. Mr Aly Touré was established between coffee-producing and Chair of the International Coffee Council 2017/18 consuming countries to strengthen the global coffee Permanent Representative of the Government of Côte d’Ivoire to sector and promote its sustainable expansion. international organizations

4 ICICO Annual Review 2017/18

Message from the Executive Director

It is a pleasure to present the Annual Review of the value chain. A number of other public events on the International Coffee Organization for 2017/18, a year of same theme were also held, including as a focus of change for the ICO and for the global coffee sector. the International Coffee Day information campaign. In terms of the internal functioning of the The main conclusion to be drawn is that increased Organization, our greatest challenge was to deal with gender equality is not only a human right, but also the implications of the regrettable withdrawal of the makes good sense in economic terms and for the United States of America from the 2007 International future sustainability of the coffee sector. Coffee Agreement. The consequent reduction in Listening and responding to calls by Members income from contributions required a significant to have wider access to sources of financing for change in the Organization’s structure, especially coffee development projects, we hosted a number in terms of staffing. Although the departure of of innovative events this year. These included many dedicated staff members was painful, the a Consultative Forum exploring how digital restructuring has been designed to minimize any technologies and new financing instruments can adverse impact on the services that our Members improve access to finance, as well as a Partnership expect from us. As we move forward in coffee year Fair and a Donors Forum during which bilateral 2018/19, we will review the impact of such changes and multilateral development agencies, financial to ensure the ICO continues to fulfil its essential role institutions and donors presented their priorities in the world coffee sector. and opportunities for collaboration with Members. Despite these testing times, important progress We are ready to assist Members to develop and seek has been made to further improve the efficiency funding for projects, and hope to see more concrete and effectiveness of the Organization. Members results in the near future. have approved a set of key performance indicators As the ICO does not function in a vacuum, we to provide objective measurements of the ICO´s must continue to establish partnerships with key progress in meeting the goals set out in our Five- non-governmental actors in the world coffee sector, year Action Plan (2017-21). Another innovation has in addition to Member governments, in order to been the introduction of an annual theme for the achieve our goals. Building on the Memorandums work of the Organization, in alignment with the of Understanding with the Global Coffee Platform Sustainable Development Goals of the United and the African Fine Coffees Association, signed in Nations. This initiative will enable us to sharpen the 2016/17, this year we established new links with the strategic focus and to better define the priorities of Sustainable Coffee Challenge (under the auspices the Organization and their implementation, as well of the Conservation International Foundation), and as to streamline resources to enable the ICO to meet the International Women´s Coffee Alliance. An its goals. important outcome from such collaboration has Our first annual theme was gender equality, on already manifested in the publication of the Guide which we published two studies, and in September to Accessing Green and Climate Funding: The Global 2018 hosted a workshop on “Women in Coffee”, Environment Facility (GEF), a joint initiative with the including a panel of high-level experts who explored Sustainable Coffee Challenge; other measures are ways to foster gender equality across the coffee already underway to strengthen the global coffee

5 Message from the Executive Director

sector. We have also taken great strides to establish The Secretariat and I are committed to ensuring that and re-establish an active dialogue with our fellow the Organization is nimble, innovative and relevant international organizations, and had the honour to in these challenging times. Working closely with our welcome Mr Kitack Lim, Secretary General of the Members and the wider coffee community, I am sure International Maritime Organization, and Ms Luiza that together we can go far. Carvalho from UN Women, to present at the Opening Finally, I would like to express my gratitude for Ceremony of the 122nd Session of the International the support received from delegates, staff members Coffee Council in September 2018. and all those who share my passion for coffee, not Crucially, one cannot ignore the external only as a source of sensory pleasure but also as a environment in which the Organization and our positive force in economic, social and environmental Members work, and this year will be remembered development. as one of particular strain. Coffee prices have been systematically falling over the last two years and reached their lowest point in recent history during September 2018, the last month of the 2017/18 coffee year. The low prices received by growers call into question the economic sustainability of the world coffee sector and are a source of great unease to all ICO Members. This deep concern was expressed with the passage of Resolution 465 on José Sette “Coffee price levels”, which gives the Organization Executive Director a strong mandate to take actions, such as: the International Coffee Organization promotion of effective exchanges between Members of national public policy initiatives to deal with low prices; the encouragement of exporting Members to adopt programmes to further raise their internal consumption of coffee; and the strengthening of ties with the private sector, especially the international roasting industry. In response, the annual theme of the work of the ICO for 2018/19 will be the economic sustainability of the coffee sector, which will enable us to explore various possible approaches to a multifaceted and complex issue. As the only intergovernmental body dedicated to coffee with a global reach, the ICO is uniquely placed to lead this important dialogue in order to foster inclusive and sustainable growth.

6 ICO Annual Review 2017/18

International Coffee Council and associated meetings

The International Coffee Council is the ICO’s governing body. It meets twice a year to discuss wide-ranging issues with the aim of promoting a sustainable coffee sector.

121st Session: 7-12 April 2018 Mexico City, –– The introduction of an ICO Award for Coffee- Related Research to stimulate research on Mexico emerging issues in the global coffee sector while The 121st Session of the International Coffee Council strengthening partnerships with universities and and associated meetings were presided over by the research institutions. Chair of the Council, H.E. Mr Aly Touré of Côte d’Ivoire. –– The alignment of the Organization’s work programme to the Sustainable Development Goals, Council decisions included the approval of: including an annual thematic focus. –– A Memorandum of Understanding between the ICO and Sustainable Coffee Challenge, under –– A bid by the Government of Kenya to host the 124th the auspices of the Conservation International Session of the International Coffee Council and Foundation, with the objective to expand and associated meetings in Nairobi in 2019 enhance the coordination of public-private collaboration in the coffee sector towards a During the 121st Session of the Council, the ICO sustainable and healthy coffee community, at –– Hosted a Dissemination Workshop on Coffee Leaf the same time as contributing to the Sustainable Rust. Development Goals. –– Hosted a Dissemination Workshop on Coffee and –– Resolution 462 calling on Member Governments to Health. encourage the USA to continue to be a Member of the International Coffee Organization. –– Co-Funding a specialized study Economic and Policy Analysis for Improving Smallholder Coffee Producers’ Incomes. –– The establishment of a Coffee Sustainability Projects Trust Fund to mobilize funds to assist Members in the design, financing and monitoring of development projects.

7 ICO Annual Review 2017/18

Ms Luiza Carvalho of UN Women

122nd Session: 17-21 September 2018 Dates of future sessions: London, United Kingdom –– 124th International Coffee Council: 25-29 March With the theme of “Women in Coffee”, the International 2019 (Nairobi, Kenya). Coffee Council and associated meetings were presided –– 125th International Coffee Council: 23-27 September over by H.E. Mr Aly Touré of Côte d’Ivoire. 2019 (London, United Kingdom). –– 126th International Coffee Council: 20-24 April 2020 Council decisions included the approval of: (location tbc). –– A Memorandum of Understanding between the –– 127th International Coffee Council: 11-17 September ICO and International Women’s Coffee Alliance to 2020 (Bengaluru, India). promote women empowerment and inclusion as a means of achieving sustainable development through social and economic progress in coffee- “The time has come to realize that investing producing countries. in gender equality is good business, not –– Resolution 465 on Coffee Price Levels, to ensure only for empowering women to realize the economic sustainability of coffee producers. their full potential and participate fully –– A project proposal to support a sustainable coffee in sustainable development, but also to sector in Uganda. promote results that will benefit current and –– A monitoring framework for the implementation of Key Performance Indicators. future generations of the world ...” –– The Programme of Activities for coffee year 2018/19. –– The composition of Committees and office holders Ms Luiza Carvalho, for 2018/19, including the election of Ms Stefanie Regional Director, UN Women for the Küng (Switzerland) as Chair and Mr Deny Wachyudi Americas and the Caribbean Kurnia (Indonesia) as Vice-Chair. Opening Ceremony: 122nd Session of the International Coffee Council

8 ICO Annual Review 2017/18

During the week of the 122nd Session of the Council, –– Launch reception of the book ‘Coffee: A Global the ICO hosted a series of public-facing events History’, by Professor Jonathan Morris from the including: University of Hertfordshire. –– A Thematic Workshop: Women in Coffee with a –– Coffee cupping organized by female-led roasting panel of high-level experts to explore ways of company Girls Who Grind Coffee. fostering gender equality in the coffee sector. –– The 8th Consultative Forum on Coffee Sector The ICO would like to thank the Government of Mexico Finance focusing on harnessing technology and for hosting the 121st Session of the International innovation for investments in the coffee sector Coffee Council and associated meetings in Mexico and how digital technologies and new financing City, and to the Governments of Burundi, Côte instruments could improve coffee growers’ access d’Ivoire and Nepal, Conservation International (CI), to finance. Girls Who Grind Coffee, National Coffee Association of the United States of America (NCA), Specialty Coffee –– A Donors Forum to assist Members to learn and Association (SCA), Tate Coffee, Vietnam Coffee and link with key donors, international organizations Cocoa Association (VICOFA), United Nations Industrial and other partners. Development Organization (UNIDO) and the University –– A Partnership Fair to provide a platform for of Hertfordshire, for sponsoring the exhibition and international cooperation agencies, donors and events held as part of the 122nd Session. partners to share with delegates their programmes, The ICO expresses its immense gratitude to the tools, funding opportunities for the coffee sector International Maritime Organization (IMO) and staff and the procedures for application. for providing the venue and invaluable support for –– An exhibition to showcase projects, products and the 122nd Session of the International Coffee Council services, share innovation, promote good practice in September 2018. and foster cooperation. Exhibitors included the Government of Burundi, Government of Nepal, United Nations Industrial Development Organization (UNIDO), Vietnam Coffee and Cocoa Association, as well as a stand dedicated to International Coffee Day. Excellent coffee served during this year’s –– Launch receptions of the e-book: ‘Women in Council Sessions was kindly provided by Coffee in Brazil,’ supported by Embrapa – the Honduras, Mexico, Nepal and Vietnam. Brazilian Agricultural Research Corporation – and spearheaded by the Brazilian Chapter of the International Women’s Coffee Alliance.

H.E. Dr Le Quoc Doanh, Vice Minister of Agriculture and Mr Kitack Lim, Secretary General of the IMO Rural Development (Vietnam)

9 International Coffee Council and associated meetings

Resolution 465 Resolution 465 on encouragement of exporting Members to adopt programmes to further raise their internal 1 Coffee Price Levels consumption levels and the strengthening of A key focus for discussion at the 122nd Session ties with the international roasting industry as a was the impact of current low coffee prices matter of urgency. on the livelihoods of coffee farmers, increasing The Resolution covers four main areas: food insecurity, reducing access to health and advocacy and communication; mobilization education and increasing the propensity to of coffee stakeholders; research, knowledge- migrate or take other extreme measures such as building and transparency; and the promotion of turning to the cultivation of illicit crops. coffee consumption. The Executive Director emphasized the important role for the ICO as the voice of the entire world coffee sector and the need to convey this serious situation to the outside world, including consumers, the ever-growing roasting Resolution 465 gives the ICO industry and the wider international community. the mandate to take action This discussion led to the approval of Resolution 465 on coffee price levels, giving a mandate to to ensure the economic the ICO to take action to ensure the economic sustainability of coffee producers, including sustainability of coffee the effective exchange between Member States producers of national public policy initiatives promoting economic sustainability and consumption, the

1. ICC Resolution 465 on Coffee Price Levels, September 2018

10 ICO Annual Review 2017/18

A forum for dialogue

The International Coffee Organization is the only global forum on coffee matters, bringing together exporting and importing governments, while also working with the private sector. Through this convening power, we strive to drive change through exchanges of views on coffee matters, market conditions and trends, and to coordinate and implement policies to address the challenges and opportunities facing the global coffee community.

11 A forum for dialogue

Coffee is the drink most consumed after water – Examples of financing instruments for the 255kg per second or eight million tonnes per year coffee sector projects:

STDF US$410m Coffee Leaf Rust, an orange powdery fungus “Hemileia vasatrix’ is one of the most common EU diseases affecting coffee production 9 billion euros

The digital revolution has a huge potential to IFAD transform the economy and the coffee sector US$294m

GEF 4.1 billion euros

12 A forum for dialogue

Fostering gender equality in the Panel speakers included a female entrepreneur and buyer of green coffee from Uganda, a representative from Nestlé coffee sector Nespresso, two female co-founders of a small-scale roaster During coffee year 2017/18, an annual theme was introduced that sourced coffee exclusively from women farmers, and to guide the work of the Organization, not only to improve the Director of the Gender Team of the European Bank for the efficiency of ICO operations but also to position itself Reconstruction and Development. A key conclusion of the as an agenda-setting institution in the coffee and wider Thematic Workshop – moderated by Ms Eileen Gordon political arena, in alignment with the 2030 Agenda for from the European Coffee Federation and chaired by Ms Sustainable Development. Kellem Emanuele, President of the International Women’s The first of its kind for the ICO, a Thematic Workshop Coffee Alliance – was that the global coffee sector is very on Women in Coffee kicked off a series of public and live- diverse and complex. Hence, the level of empowerment, as streaming events held during the week of the 122nd Session well as the gender gap, varies greatly between countries of the International Coffee Council in September 2018. and regions, and at different stages of the value chain. Reflecting the chosen theme of the ICO for coffee year A consensus exists that there is a clear business case 2017/18 on Gender equality, the Workshop not only served for gender equality, not only contributing to achieving UN as the launch pad for the ICO’s latest insight report ‘Gender Sustainable Development Goal (SDG) 5, but also wider equality in the coffee sector’2, but also brought together economic benefits, such as improved welfare for rural delegates from the public and private sectors, in addition communities, as well as higher productivity to help to meet to a panel of speakers from across the coffee value chain to the growing demand for coffee. However, more data is explore the obstacles faced by women in the coffee sector needed to develop targeted solutions ranging from gender and to identify possible solutions for empowerment and policies and development programmes, non-discriminatory equality. supply chain policies, to management and leadership training for women. Panellists also agreed that in order to support women, foster empowerment and gender equality, the public and private sectors need to work hand in hand, contributing to achieving SDG 5.

Ms Barbara Rambousek of the European Bank for Reconstruction and Development

Melanie Landthaler launching Nestlé Nespresso’s AAA Programme Report on gender equality

Some of the panellists in the ICO’s Thematic Workshop on Gender Equality

2. ICC-122-11 – Gender equality in the coffee sector. An insight report from the International Coffee Organization, September 2018

13 A forum for dialogue

How digital technologies and new financing instruments can improve access to finance The first panel provided an opportunity to learn about new technologies and innovative approaches currently Held once a year, the Consultative Forum on Coffee being implemented and leaving a mark across agricultural Sector Finance is one of the most significant world commodity sectors, such as blockchain applications coffee events to facilitate discussion on topics related to and insurance schemes for smallholder farmers against finance and risk management in the sector, particularly price volatility. The panellists discussed the potential for the needs of small- and medium-scale producers adoption of these innovations in the coffee sector and and coffee communities. Sponsored by Conservation identified the barriers that needed to be overcome to ensure International (CI), the 8th Consultative Forum on Coffee financial inclusion. The second panel explored how impact Sector Finance3 in September 2018 focused on how investments, as well as climate and green bonds, could digital technologies and new financing instruments could channel additional funds into the coffee sector, to support improve coffee growers’ access to finance. Chaired by investments in the rehabilitation and renovation of ageing Mr Kirill Matrenichev (Russian Federation), the Forum coffee trees as well as increase productivity and resilience featured speakers who shared innovative approaches to the impact of climate change. The experts also discussed and technologies from across the public and private how to ensure that additional funds could be channelled sectors, including from Stable, bext360, the Coffee Board into the sector to reach and benefit marginal producers of India, London Business School, UBS, Climate Bonds through smart finance instruments and structures. Initiative, Common Fund for Commodities and CI.

The Forum reached three main conclusions:

1. The rise of new technologies and the data revolution could have a significant and positive impact on producers via many channels, including improved access to finance.The digital revolution has a huge potential to transform the economy and the coffee sector. However, if not managed properly, technological change also has the potential to increase inequalities. Steps must be taken to ensure that small and marginalized farmers, such as female producers, could benefit. Otherwise, technology could increase the divide between the digital have- and have-nots. The panellists stressed that there is a role for both the government and the private sectors to play to ensure financial inclusion.

2. The financing requirements of the coffee sector could be partly met by new and innovative instruments. Participants stressed that a blending of different finance instruments – for example, impact investment, green bonds and grant elements – could be particularly effective. The challenge is not necessarily the availability of funds, but the availability of bankable projects. A lot of thought therefore was going into designing structures and mechanisms that allows the matching of financiers with environmental and social impact objectives with projects supporting coffee growers and communities. The 2030 Agenda for Sustainable Development and the Sustainable Development Goals provides an excellent framework and a common language for investors and those designing projects to formulate impact objectives and track progress, unlocking finance opportunities.

3. In order to pursue sustainable coffee production that is economically viable, the collaboration of all stakeholders in the sector, the governments, the industry, NGOs and donor institutions is necessary. For example, governments could provide the right regulatory framework to facilitate adoption of new technologies, provide smart subsidies to increase uptake and ensure financial inclusion. Harnessing risk-sharing between private investors and multilateral development banks could increase the availability of finance for agricultural producers.

3. CF-16/18 - Summary report of the 8th Consultative Forum on Coffee Sector Finance

14 A forum for dialogue

Promoting funding opportunities ICO Member countries and all coffee stakeholders of Foreign Affairs and International Cooperation, and face many challenges affecting their livelihood, the African Export-Import Bank. sustainability and businesses, including price The presentations made clear that there were volatility, costs of inputs, gender inequality, pests numerous financing instruments already in place for and diseases and climate change. To address these the coffee sector, including development assistance challenges, the ICO assists Members in project across coffee-producing countries, particularly for identification, design, fundraising and monitoring smallholder farmers. STDF provided an overview of and by linking public and private coffee stakeholders Official Development Assistance (ODI) benefitting the with international organizations, institutions, donors coffee sector: some 500 projects that had a reference and the private sector. to the coffee sector across 60 developing countries During coffee year 2017/18 the ICO also hosted between 2006 and 2016, totalling US$410 million. As two innovative events opened up to the wider public the world’s main development donor, for the period – a Donors Forum and Partnership Fair – both of 2014-2020, the European Union is providing around which were chaired by H.E. Mr Iván Romero-Martínez 9 billion euros for agricultural rural development (Honduras) and helped to chart a path to further and nutrition projects, with 60 countries already collaboration. selected for agricultural support and a number of projects covering specifically the coffee sector. IFAD is financing 15 projects with components on Donors Forum4 Sponsored by the United Nations Industrial coffee value chain development in 13 countries, Development Organization (UNIDO), the objective totalling US$730 million (IFAD contributes US$294 of the Donors Forum was to expose Members to million). The GEF – established to leverage public best practices and organizations supporting coffee and private sector funding in order to mitigate the sector development projects and their priorities effects of climate change and reduce environmental and funding mechanisms. Presentations were given impact – with a current financing cycle (GEF-7) by high-level representatives from key bilateral amounting to US$4.1 billion, now includes coffee and multilateral agencies and one regional trade in the list of commodities eligible for funding. The finance institution, including: Standards and GEF representative praised the ICO for the timely Trade Development Facility (STDF)/World Trade preparation of its guide on GEF-7 funding, developed 5 Organization (WTO), the European Commission (EC), in conjunction with the Sustainable Coffee Challenge. Global Environment Facility (GEF), International Fund for Agricultural Development (IFAD), Italian Ministry

4. PJ-127/18 - Donors Forum: Project Development Funding Report 5. ICC-122-9. Guide to Access Green and Climate Funding for the coffee sector. The Global Environment Facility (GEF): International Coffee Organization and Sustainable Coffee Challenge, August 2018

15 A forum for dialogue

Partnership Fair6 promote access to finance in Uganda, and South- The Partnership Fair provided a further platform East Asia and a public-private partnership in Peru. for international cooperation agencies, donors and –– JICA’s technical cooperation in Ethiopia, the partners to share with delegates their programmes, Philippines, Rwanda and Thailand, along with tools, and funding opportunities for the coffee sector support for private sector investment and financing and the procedures for partnership and application. in Vietnam. Presentations were given by representatives from –– UNDP’s Green Commodities Programme using a the following cooperation agencies and international multi-stakeholder approach, including the Coffee organizations: International Trade Centre (ITC), National Action Plan of Peru, which guarantees United Nations Industrial Development Organization the development and sustainability of coffee by (UNIDO), Deutsche Gesellschaft für Internationale increasing levels of production and productivity. Zusammenarbeit (GIZ), Standards and Trade Development Facility, Global Environment Facility, –– IFAD’s work to improve the livelihood of smallholder Japan International Cooperation Agency (JICA), farmers and promote inclusive value chains in the United Nations Development Programme (UNDP), coffee sector in Uganda. International Fund for Agriculture Development –– Twin’s promotion of market linkages between (IFAD), as well as Twin and Twin Trading. Examples small-scale farmers across the entire value chain, of existing support provided to the coffee sector providing technical assistance, in collaboration with included: producer organizations, for example on governance, –– The ITC connecting companies from coffee- gender, sustainable agriculture, quality, business producing countries with buyers and roasters, and management and market access. An example cited providing assistance for developing country coffee was the Export Capability Programme in Rwanda strategies, for example in East Africa, Indonesia and and Burundi. Nepal. Member delegations had the opportunity to deepen –– The Coffee Sustainability Programme in Ethiopia discussion on partnership for financing development (€4 million) implemented by the Department of Agri- projects during the Q&A session that complemented business of UNIDO – a public-private partnership each presentation and also continued the dialogue funded by the Italian Government, illycaffè and the with speakers bilaterally. To respond to demand Ethiopian Coffee and Tea Authority, in addition to for further assistance by Members following the UNIDO’s work on promoting a circular economy in publication of the Guide to Access GEF financing7, Madagascar, Peru and Vietnam. the ICO will now produce a comprehensive guide on how to access the support provided by multilateral –– GIZ’s programmes for a sustainable supply chain, and bilateral funding institutions. including cooperation with the private sector to

“Our sincere thanks to the ICO for this innovative approach and to all the speakers and their organizations for their commitment and for sharing with ICO Members the many opportunities to support the sustainable development of the coffee sector. We look forward to closer cooperation.”

Chair of the ICO Project Committee H.E. Mr Iván Romero-Martínez (Honduras)

6. PJ-128/18 - Partnership Fair Report 7. ICC-122-9. Guide to Access Green and Climate Funding for the coffee sector. The Global Environment Facility (GEF): International Coffee Organization and Sustainable Coffee Challenge, August 2018

16 A forum for dialogue

Sharing developments in coffee Today, consumer values are driving changes in product choices, behaviour and attitudes. Consumers consumption and health increasingly value ethical sourcing, sustainability, Coffee is the drink most consumed after water – 255kg certification and products that support health, per second or eight million tonnes per year, hence with changes seen most clearly when examining the drink is of immense interest, especially in terms generational differences. If consumers knew the good of its potential effects on health. The ICO hosted news about coffee, they would increase consumption. a public Dissemination Workshop on Coffee and Concern was raised that a legal ruling from California, Health8 during the 121st Session of the International commonly referred to as Proposition 65, could result Coffee Council in Mexico City to share the latest in warnings on coffee cups associating coffee with developments relating to coffee consumption and cancer. This was despite study after study proving no health, with presentations from eminent speakers link between coffee and cancer. in the field: Dr Astrid Nehlig – Research Director The main conclusions of the Workshop were as follows: at the French National Medical Research Institute, –– Communication on coffee and health needs to Professor Rui Daniel Prediger PhD – Department of separate the clutter from the credible science, to Pharmacology, Federal University of Santa Catarina, be factually accurate, simple and straight-forward Brazil, and Mr William ‘Bill’ Murray, President & CEO of the National Coffee Association of the USA. –– Key messaging points should be developed and Latest research confirms that coffee has reinforced with examples from third-party experts numerous benefits to health, including improved –– A need for wider dissemination of information on mood and performance, increased vigilance, coffee and health within the sector prevention of age-related cognitive decline (mainly –– Support for more research studies and the best in women), prevention of Parkinson’s disease and methods to communicate the findings to consumers possibly Alzheimer’s disease, liver cancer and in order to increase coffee consumption across the diseases, Type II diabetes, and protection of the world cardiovascular system. As the world of medicine constantly evolves, –– A call for all parties across the coffee sector to the challenge is how to communicate the positive come together to help everyone in the coffee effects of coffee to consumers and in so doing supply chain to grow consumption. increase levels of coffee consumption.

8. PM-58/18 - Summary report of the Dissemination Workshop on Coffee and Health 17 A forum for dialogue

Coffee Leaf Rust, an orange powdery fungus ‘Hemileia vasatrix’ is one of the most common diseases affecting coffee production

Learning lessons on Coffee Leaf Rust The ICO hosted a public Dissemination Workshop learning. Other than India, none of the other countries on Coffee Leaf Rust during the 121st Session of the undertake regular monitoring of the evolution of rust International Coffee Council to share the outcomes races. The evaluation of Coffee Leaf Rust race profiles and lessons learned in managing this devastating in all countries was undertaken and an updated list disease in selected Member countries. Keynote of races compiled, including new races not previously speaker Dr Charles Agwanda of CABI9 presented the recorded. The research capacity in the countries was results and lessons learnt from its Coffee Leaf Rust increased and modernized, leading to trials with new Management project – an ICO-sponsored initiative, and existing materials under a range of field conditions. financed by the Common Fund for Commodities In India, an innovative ‘Café Móvel’ telephone helpline and implemented by CABI in India and four African service was introduced, providing direct support and countries including Kenya, Rwanda, Uganda and real-time information to coffee farmers on the latest Zimbabwe. research, in addition to a complementary face-to-face Coffee is an important source of foreign extension programme, helping to boost yield and quality. exchange earnings for all the five target countries, Through ‘Café Móvel’, growers not only receive advice mainly grown by smallholders for whom coffee and access to market data, auction prices and weather accounts for the substantial proportion of their in their local language, but are also able to create livelihoods. Along with falling productivity and quality, discussion threads and invite feedback from other Africa and India are the regions most affected by farmers and wider experts. This real-time access to Coffee Leaf Rust, due to control agents – particularly pest management information is important to develop expensive pesticides out of reach of the majority timely strategies to address the challenge of Coffee Leaf of smallholders – a lack of availability of Coffee Rust. Using the model provided by ‘Plantwise’ – a global Leaf Rust resistant varieties of coffee trees, and the programme led by CABI to increase food security and added impact of climate change. The aim of this improve rural livelihoods by reducing crop losses – CABI project therefore was to build the capacity of coffee is now looking to introduce a similar initiative for coffee. stakeholders to share improved germplasm between Dr Carlos Ariel Angel of the National Coffee participant countries, conduct demand-led research Research Centre (CENICAFÉ) of Colombia, and Dr Alfredo to generate alternative methods for controlling the Zamarippa of the Secretariat of Agriculture, Livestock, disease in a sustainable way, and to deliver new Rural Development, Fisheries and Food (SAGARPA) of technologies such as resistant planting materials Mexico, also shared the experiences of their countries and environmentally-friendly control measures. in tackling the disease. Members were encouraged to Although most smallholder farmers were able continue to share and learn from the experiences of to recognize the symptoms of Coffee Leaf Rust, other countries in limiting the impact of Coffee Leaf many lacked the knowledge needed to manage Rust, as the spread of the disease was far from over, the disease, particularly in Africa. This led to the with the added burden arising from new challenges creation of platforms to facilitate farmer-to-farmer caused by climate change.

9. Centre for Agriculture and Bioscience International (CABI) is an international not-for-profit organization providing information and scientific expertise to solve problems in agriculture and the environment.

18 ICO Annual Review 2017/18

Coffee development projects

We work with government and the private sector to develop and implement strategies to enhance the capacity of local communities and smallholder farmers to benefit from coffee production, which can make a significant contribution to poverty alleviation. This work includes developing and seeking finance for projects to foster inclusive and sustainable growth.

19 Coffee development projects

Guide to Accessing Green and Climate Funding: The Global Environment Facility (GEF)

Developed in collaboration with the Sustainable GUIDE TO ACCESS GREEN AND CLIMATE Coffee Challenge, this year the ICO produced a new FUNDING FOR THE COFFEE SECTOR Guide10 to assist governments of coffee-producing The Global Environment Facility (GEF) countries to understand the opportunity and the mechanisms to access GEF funding in order to address coffee sector challenges.

ICC-122-9 V.1.2

The GEF, in its new four-year replenishment cycle In cooperation with GEF-7 with an allocation of US$4.1 billion, includes coffee in the list of commodities eligible for funding.

GEF-7 thereby provides an invaluable opportunity for countries to prioritize investments in development programmes, not only to enable sustainable coffee production, but also to have a positive impact on nature conservation, as well as on the livelihoods of coffee-producing communities.

10. ICC-122-9. Guide to Access Green and Climate Funding for the coffee sector. The Global Environment Facility (GEF): International Coffee Organization and Sustainable Coffee Challenge, August 2018

20 Coffee development projects

SEEKING FUNDS

Uganda

Supporting a sustainable coffee sector in Uganda

uring coffee year 2017/18, the ICO The project includes the following components: provided its technical expertise to assist –– Building a sustainable coffee production system the Government of Uganda to develop through transfer of technology and capacity- Dconcrete steps to implement the Uganda Coffee building Roadmap – which aims to increase the export value from its current level of US$544 million to –– Climate change adaptation and environmentally US$2 billion. responsible practices The coffee sector in Uganda continues to be –– Green coffee quality improvement and value a major contributor to the national economy in addition terms of revenue and employment, with around –– Market development for coffee farmers. 2.5 million people depending on coffee growing and trading for their livelihood. Moreover, Uganda has the largest number of small-scale coffee The Ugandan Coffee Roadmap ... farmers in the world, totalling over 1.7 million with an average farm size of 0.25 hectare. aims to increase the export value Despite fluctuations in world prices and the from its current level of government policy of diversification, coffee still US$544 million to US$2 billion remains the engine of the national economy. During the last five years, the country exported annually 3.4 million bags of coffee, generating over US$417 million in export earnings. Similar The initial total costs of the project, including to many developing countries, 84% of the total grants and loans are estimated to be US$24 population of Uganda lives in rural areas, where million over five years of implementation. The ICO poverty is widespread and concentrated among and the Ugandan Coffee Development Authority women and young people. This project aims to are actively involved in fundraising, seeking develop a more sustainable and inclusive coffee relevant partners to complement resources sector that will generate income for coffee- committed by the Government of Uganda. farming communities, including youth and women, reducing poverty among small-scale coffee farmers, while providing resources for the sustainable economic growth of the country.

21 Coffee development projects

Promoting domestic consumption

Promoting domestic consumption of coffee in producing countries can not only help to strengthen production, but also assist in alleviating poverty and increase value addition.

Latin America (Due for completion in 2019) Asia The Regional Cooperative Programme for the ICO Members from Asian coffee-producing Technological Development and Modernization of nations are in discussion to reach a consensus Coffee Cultivation (PROMECAFE) is approaching on use of the Special Fund to promote domestic the end of a three-year project funded by the consumption in the region. ‘Special Fund’ (see below) to promote and increase domestic consumption in Costa Rica, the Dominican Republic, El Salvador, Guatemala, Honduras, Jamaica, Mexico, Nicaragua and Panama. The current average per capita domestic consumption is 1.23kg per year, with the aim to Special Fund increase this by 30% by 2019. Using the funding The Special Fund was established under received – US$458,566 – to date the project the International Coffee Agreement 1976 has included regional workshops, with the and continued under the International participation of Member countries, coffee experts Coffee Agreement 1983 to finance and representatives of the coffee industry. The additional measures required to remaining cycle of the project is focusing on the ensure that relevant provisions of the development of regional promotional materials Agreements could be implemented, such to showcase the links between coffee and as introducing the system of certificates health, and coffee and sports as potential ways of origin, expenditures involved in the of improving the domestic consumption strategy verification of stocks as well as the in each country. costs of the improvements in the system for the collection and transmission of statistical information. The Fund was Africa (Ongoing project) The Interafrican Coffee Organization (IACO) built up by a levy on each bag of coffee has recently sought approval for use of the exported to importing Members, payable portion of the Special Fund designated for by exporting Members. As market control Africa to promote domestic consumption in mechanisms were no longer in force the continent. Africa has a great potential for in the subsequent International Coffee coffee consumption, but domestic consumption Agreements of 1994, 2001 and 2007, the across the producing countries of the region, use of the Special Fund was not required. with the exception of Ethiopia, is limited. The The Fund was therefore liquidated to significant levels of urbanization in the continent allow for distribution of the fund totalling and a youth cohort comprising more than 70% US$1,376,233 as at 30 September 2016 of the population, represents a huge opportunity among the three coffee-producing for entrepreneurship as well as a potential regions (Africa, Asia and Latin America) increase in consumption, which bodes well for on projects focused in particular on the the transformation of the African coffee value promotion of consumption. chain. IACO is developing partnerships with other African countries, and with the African Export- Import Bank – nominated by the African Union to be the lead agency for the Africa Free Trade area.

22 Coffee development projects

DUE FOR COMPLETION 2020

Colombia

Satellite remote sensing for improved and sustainable coffee production: Colombia

ustainable coffee production is becoming This project also has an important gender and ever more important as the high-altitude inclusion component, prioritising engagement areas where coffee is grown, such as in with female smallholders. During farm visits, SColombia, are increasingly sensitive to the effects comprising exploration of coffee plantations of climate change, as well as pest and diseases. with reference to recent satellite imagery and This collaboration brings together a collection of GPS waypoints, female farmers British SME, Colombian SME, the ICO and in particular will be invited to assist as guides, the Colombia Coffee Growers’ Federation whereby they will become involved in inspecting (FEDECAFE11 ). This innovative project – estimated and interpreting satellite imagery in relation to at £350,000 and funded mostly by Innovate UK12 – features on the ground. The project team will will develop the use of satellite data for mapping seek to collaborate with female growers, through and monitoring changes in coffee plantations, as training in the use of satellite and remote sensing well as monitoring the condition of the crop in technologies to facilitate information gathering relation to pests and diseases, and deterioration and strengthen adaptation to climate change. due to climate change. The project will include testing the use of different types of data, with a focus on high resolution satellite data, in addition to the collection of UAV/drone data for localized detailed analysis. Recent developments This project also has an important in satellite data availability, linked to cloud-based gender and inclusion component, processing, are potentially ground-breaking for prioritising engagement with female the coffee sector, including online delivery of images and products directly into existing coffee smallholders crop information systems. Results are aimed at implementation within national systems, contributing to decision-making processes as well as improving the technical support services offered to growers.

10. ICC-122-9. Guide to Access Green and Climate Funding for the coffee sector. The Global Environment Facility (GEF): International Cstainable Coffee Challenge, August 2018. 11. FEDECAFÉ represents over 500,000 coffee-growing families, providing technical assistance to address environmental, pest and disease challenges. 12. Innovate UK is a non-departmental public body operating at arm’s length from the UK Government’s Department for Business, Energy and Industrial Strategy.

23 Coffee development projects

Monitoring implementation of Sustainable Development Goals How can coffee farmers, policy makers and coffee companies track the implementation of Sustainable Development Goals (SDGs)? The Delta Project is a collaborative initiative between the ICO, the Global Coffee Platform (GCP), the Better Cotton Initiative and the International Cotton Advisory Committee to develop a commonly Coffee Sustainability Projects Trust Fund agreed sustainability performance measurement To foster investment to ensure the and reporting framework. This framework will economic, social and environmental include a set of indicators that will help track sustainability of the coffee sector, compliance with SDG commitments across the particularly the challenges faced by public and private sectors. The data required to smallholder farmers, in 2018 the ICO implement the measurement framework will be established the Coffee Sustainability collected at farm level, including testing the use Projects Trust Fund. Through this Fund of innovative technology for data collection. The the ICO’s focus is to sensitize potential project aims to benefit multiple parties including: donors and mobilize adequate funds and resources to better assist Member –– Farmers: better targeted services and countries in a number of key areas, information for decision and learning including project identification and –– Governments: globally relevant metrics for development, monitoring and evaluation aligned reporting, and evidence-based decision- of development projects in the coffee making for agricultural policies and services sector, identifying and disseminating –– Private sector: comparable SDG reporting, good practice and capacity-building. standardized sustainability information to The Trust Fund will play a pivotal role customers and simplified data collection. to finance the actions identified for the implementation of ICC Resolution 465 The Delta Project has a three-year life cycle and on Coffee Price Levels. is funded by a CHF550,000 (£438,000) grant from the ISEAL Innovations Fund13.

13. The ISEAL Innovations Fund seeks to support the best innovations that can help sustainability standards to deliver more value to different stakeholders and to be more effective at driving improvement over time and at scale.

24 %

ICO Annual Review 2017/18

Markets, statistics and economics

We stimulate market transparency through the collection, dissemination and publication of a wide range of high-quality statistics on the world coffee sector.

25 %

Markets, statistics and economics

World coffee production in coffee year 2017/18 Colombian Milds was 163.51 million bags, 4.8% higher than in 12.8% 2016/17. Price drop

Other milds 15.9% Price drop

Brazilian Naturals 23.7% Price drop

Robusta 15.7% Price drop

World coffee market 2017/18

26 Markets, statistics and economics

Growth in coffee production substantially increased supply in coffee year 2017/18, greatly contributing to the lower prices.

World Coffee Market The world coffee sector is important to the livelihoods which includes part of its crop for April 2018 to March of millions of people, particularly in developing 2019. Vietnam is the world’s second largest producer countries, and in many of these countries production and largest grower of Robusta coffee. In 2017/18, is on small-scale family farms. However, in coffee its output rose 15.5% to 29.5 million bags. Adverse year 2017/18, the composite indicator averaged 111.51 weather led to a decline of 4.3% to 14 million bags for US cents/lb, 15.8% lower than the average of 132.43 Colombia’s production. Indonesia’s output declined US cents/lb in 2016/17. This sustained downward by 7% to 10.36 million bags, while production in trend in coffee prices has been a great concern Honduras increased 3.3% to 7.7 million bags. to the ICO and the world coffee sector over the Coffee is a highly traded commodity, and the past year, given that coffee growers have received larger harvest in 2017/18 was reflected in increased reduced remuneration for their coffee, accentuating shipments. Total coffee exports increased in each their already precarious living conditions. year since 2010/11 with a new record reached Growth in coffee production substantially in 2017/18 at 121.86 million bags, 2% higher than increased supply in coffee year 2017/18, greatly 2016/17. In the twelve months ending September contributing to the lower prices. Global output 2018, exports of green Arabica totalled 70.95 million reached a record 163.51 million bags, 4.8% higher bags, compared to 70.51 million bags in the previous than in 2016/17. South America accounted for 47% year; whereas green Robusta exports amounted to of world production followed by Asia & Oceania at 39.24 million bags, compared to 38.87 million bags. 29%, Central America & Mexico at 13% and Africa at Total shipments of all forms of coffee increased in 11%. Brazil, the world’s largest producer of coffee, four out of the ten largest exporters for coffee year increased its output by 5.6% to 57.4 million bags, 2017/18, including the two largest, Brazil and Vietnam.

ICO INDICATOR PRICES

ICO CM1 OM2 BN3 ROB4 2011/12 169.82 222.95 206.77 195.77 102.41

2012/13 127.86 158.77 148.63 133.12 98.11

2013/14 141.00 178.44 179.43 152.8 95.86

2014/15 136.14 168.26 174.81 146.69 93.25

2015/16 121.30 148.19 157.55 131.62 83.14

2016/17 132.43 158.79 159.56 153.15 103.61

2017/18 111.51 138.54 134.18 116.91 87.36 % change -15.8% -12.8% -15.9% -23.7% -15.7% 2016/17 - 2017/18

27 Markets, statistics and economics

World coffee consumption is estimated at 161.93 million bags in coffee year 2017/18, 1.8% higher than in 2016/17. The fastest growing region was Asia & Oceania, where consumption in coffee year 2017/18 is estimated at 35.9 million bags, up 3.1% from last year. This is followed by North America, which grew 2.6% to 30.34 million bags in coffee year 2017/18. Both Africa and Mexico & Central America reversed the declines in coffee consumption during 2016/17 to grow by 1.7% to 11.08 million bags and 1.7% to 5.3 million bags in coffee year 2017/18, respectively. Europe is provisionally estimated to maintain its growth rate of 0.5% with consumption estimated at 52.32 million bags in 2017/18. After increasing by 3.5% in 2016/17, coffee consumption in South America is provisionally estimated to rise by 1.8% to 26.97 million bags. The five largest consuming markets that account for a cumulative total of 64.3% of global consumption are the European Union (26.4%), the USA (16.3%), Brazil (13.6%), Japan (5%) and Indonesia (2.9%). In coffee year 2017/18, coffee production In coffee year 2017/18, exceeded consumption by an estimated 1.59 million bags. This surplus contributed to the low prices coffee production exceeded last year. Additionally, record exports in coffee year consumption 2017/18 put further pressure on prices as the market by an estimated was well supplied at the start of 2017/18 even with growing consumption. Inventories at the end of 1.59 million bags September 2017, the month before the start of coffee year 2017/18, reached 25.8 million bags, which is the largest volume on record for September.

WORLD COFFEE PRODUCTION

0.18

0.16

0.14

0.12

0.1

0.08

million 60-kg bags 0.06

0.04

0.02

0 2014/15 2015/16 2016/17 2017/18

Coffee year commencing October* Arabica Robusta

*For countries with crop years commencing April or June, their production has been allocated across two coffee years.

28 Markets, statistics and economics

Improving ICO statistics To continue to ensure that the ICO provides high quality, reliable and consistent statistical information on the global coffee sector, the ICO Statistics Section has focused its activities on closer engagement with Members and the private sector. Key actions include: –– The introduction of training for statisticians from Member countries, in order to ensure compliance with statistical information requirements14. This valuable face-to-face engagement with Members Mr Paul Okewa with members of not only resulted in improved communication with the ICO Statistics team the Secretariat, but notable improvements and thus higher quality data in the reports submitted by these Members –– Amendments to the ICO Rules on Statistics: –– Research seeking views from Members and Certificates of Origin, in order to provide more other users of statistical data on the relevance flexibility to accommodate changing production of the variables collected by the ICO. Feedback patterns and technical upgrades in export reporting demonstrated that ICO data was a fundamental systems used by authorities. source of information, as well as identifying new variables for inclusion in the ICO’s statistical Statistics Roundtable database. The Statistics Roundtable, now in its fifth year, brings together the ICO with analysts from the coffee sector, in order to share supply and demand data “I had always been on the lookout for from a global perspective. During coffee year 2017/18, what works best in terms of statistical the Statistics Roundtable met four times to review reporting. The hands-on training at the data from producing countries covering over 95% of global coffee production, as well as data on coffee ICO provided an immediate solution.” supply and consumption. Mr Paul Okewa (Statistician, Kenya)

–– Technical analysis of the ICO statistical database to “Congratulations to the ICO for the huge gain a better understanding of the characteristics progress made in improving the quality of and quality of ICO data, as well as the primary areas supply/demand data [which is now] close to of concern. As a result, enhancements were made to the data management system in order to further becoming a highly credible international increase the efficiency of the Secretariat’s work benchmark for coffee sector statistics.” and the quality of services provided to Members. Mr Euan Mann (Complete Commodity –– Sourcing data from third parties in cases where Solutions and Chair of the Statistics Roundtable) official statistics from Members were inconsistent or incomplete. –– Continuous improvement of the database of the quality of data and analytical methodologies.

14. ICC-102-10 – Rules on Statistics: Statistical Reports, May 2011 ICC-105-17 – Rules on Statistics: Indicator Prices, May 2011 ICC 102-9. Rev.1 – Rules on Statistics: Certificates of Origin, April 2018 29 Markets, statistics and economics

COUNTRY COFFEE PROFILE

In addition to providing statistics on the global coffee market, the International Coffee Organization conducts detailed analysis of the sector. Country coffee profiles are important in improving the visibility of individual countries in the world coffee economy and identifying main characteristics and current issues.

This year’s county coffee profile focused on Ghana, produced by the ICO in close collaboration with the Ghana Cocoa Board - a public institution covering coffee and also in charge of cocoa.

Ghana Although coffee cultivation was introduced in the mid-eighteenth century, it represents a small sector with an average production below 1,000 metric tonnes per year, compared to over 900,000 tonnes for cocoa. Robusta coffee is the type of coffee grown in the country, with a growing season that runs from October to September. Coffee production covers 17,000 hectares and the average yield was 300kg per hectare for smallholder farmers and over 1.5 tonnes per hectare for large farms. As the sector is the main source of income for over 8,000 households of small- Coffee growing regions in Ghana scale farmers from six regions of the country, the Government approved in 2014 a Coffee Rehabilitation Programme that included research, extension from the Ghanaian Government, the share of coffee services and high yield varieties to increase national in GDP and in total exports, is expected to increase production to 100,000 tonnes over 10 years. in the near future, as well as domestic coffee This project provides technical and financial consumption. support to over 4,500 small-scale farmers of which The ICO is working with other African Members 22% are women. Coffee farming is a profitable activity to develop Country Coffee Profiles for publication in for small-scale farmers – with main destinations of coffee year 2018/19. exports to Togo (57% of total exports), Italy (28%), India (7%) and Belgium (5%). With the undergoing revitalization of the sector, based on strong support

30 Markets, statistics and economics

ECONOMIC RESEARCH

The ICO provides a knowledge hub for objective and comprehensive economic, technical and scientific research and analysis, in partnership with academic institutions and the private sector.

Gender equality in the coffee sector their access to public services, such as training To support this year’s thematic focus on gender and extension programmes, and lack control over equality, the ICO published an insight report ‘Gender income derived from agricultural production as well equality in the coffee sector’15. Previewed at the ICO’s as investment decisions. This differential in access to Thematic Workshop on Women in Coffee in September resources and empowerment translates into a gender 2018 and officially launched on International Coffee gap in agronomic and economic outcomes, such Day, this report discusses how gender-sensitive as yields, revenues from crop sales and household 16 and evidence-based public policies, services and welfare . programmes, as well as sustainable supply chain The report also explores public policy responses policies, can reach, benefit and empower women. and private initiatives for women’s empowerment While the focus of this research is at the farm and gender equality, with case studies from level, women contribute to the coffee sector at all Nespresso, Technoserve, UN Women Colombia, levels of the global coffee value chain from farm Marks and Spencer, Taylors of Harrogate and Twin. to cup. Between 20% and 30% of coffee farms are Both the public and private sector can contribute female-operated and up to 70% of labour in coffee significantly to achieving Sustainable Development production is provided by women, depending on the Goal (SDG) 5 on Gender equality, while supporting region. However, the empirical evidence presented other objectives, such as reducing poverty in all in this report shows that compared to men, female its forms everywhere (SDG 1) and ending hunger, farm operators often have less access to land, inputs, achieving food security and improved nutrition and finance and knowledge. promoting sustainable agriculture (SDG 2). Within rural households, women often have limited say in decision making, are constrained in

15. ICC-122-11 – Gender equality in the coffee sector. An insight report from the International Coffee Organization, September 2018 16. FAO, 2011.

31 Markets, statistics and economics

The existence of complementarities of interventions also provides a strong case for public- private partnerships (SDG 17) in order to address existing constraints faced by women in coffee. Availability of baseline data to assess gender equality and empowerment remains a serious limitation for research and development of evidence-based policy recommendations. Hence, more efforts are needed to improve systematic data collection. Through publication of this insight report the ICO aims to support Members, policy makers, development institutions and wider coffee sector Development of coffee trade flows stakeholders to understand the gender gap in coffee and its determinants, set out what action can be This year the ICO conducted a study on the 18 taken by the public and private sectors, and define development of coffee trade flows comparing the the steps the ICO is taking to actively promote periods 1992-1996 and 2012-2016. The study focused gender equality in the coffee sector. on tracking the evolution of imports and exports by volume and market; analysing changes in the ICO action to promote gender equality: share of Arabica and Robusta in total exports, and; –– Disseminating findings of this report to stimulate assessing the role of processed coffee in overall discussion and continue to provide the forum for traded volumes. exchanges of views on coffee sector development The main findings of the study showed that and advocacy for gender equality for the public and during a 20-year period, coffee production increased private sectors. by 61% and domestic consumption in producing –– Recognizing gender as a cross-cutting theme and countries doubled. With 72% of green coffee including the gender dimension in future research production exported and an average growth of 57% on annual themes, as well as in other analytical work. in total exports, coffee remains a primary commodity. The exporting side of the market experienced a trend –– Extending the gender analysis beyond the farm levels towards higher concentration at the country level, so as to cover the whole coffee value chain, including while the importing side diversified with 22 countries trading, roasting, retail and consumer levels. gaining ground as important trading partners. –– Harnessing public-private partnerships to collect Arabica remained the dominant coffee variety in the data and measure progress towards achieving the global trade, comprising two thirds of total exports. SDG of gender equality. However, Robusta exports grew faster over the –– Gender Mainstreaming17 by ensuring that all past 20 years. In terms of coffee by form, 91% of development projects and initiatives supported by exports continued to be in green form but the share the ICO aim to address and provide solutions to of processed coffee exported increased, opening reduce the gender gap in the coffee sector. further growth opportunities in the soluble segment. The study also provided an innovative visualization of the global coffee trade flows from exporting countries to importing countries in the last 20 years by plotting the data using Sankey diagrams, in which the width of the arrows showed the magnitude of the flow.

17. ‘Mainstreaming a gender perspective is the process of assessing the implications for women and men of any planned action, including legislation, policies or programmes, in any area and at all levels. It is a strategy for making women’s as well as men’s concerns and experiences an integral dimension in the design, implementation, monitoring and evaluation of policies and programmes in all political, economic and societal spheres so that women and men benefit equally and inequality is not perpetuated. The ultimate goal is to achieve gender equality.’ ECOSOC 1997/2. 18. ICC-121-4. Development of Coffee Trade Flows, March 2018

32 Markets, statistics and economics

Emerging coffee markets: South and The role of the coffee futures market East Asia in discovering prices for Latin American This year the ICO conducted a study on the producers development of coffee consumption in the South This new publication provides an insight into 19 and East Asia region , examining markets in China, the suitability of futures markets as a basis for India, Indonesia, Philippines, the Republic of Korea, decision making for coffee growers. The study20 is Taiwan and Vietnam. India, Indonesia, the Philippines the result of a collaboration between the ICO and and Vietnam represent 95% of the coffee produced Georg-August University of Gőttingen, in Germany. by ICO Members in South and East Asia, and are Combining ICO coffee market data and in-house becoming increasingly important coffee consumers. research capabilities with analytical tools employed China, the Republic of Korea and Taiwan (non- by university researchers, the objective of the study members) are mainly net importers of coffee. In was to investigate the relationship between spot total, 16.8 million bags of coffee were consumed in market and futures prices for coffee, and analyze these seven markets over crop year 2016/17. the role of futures markets as a price discovery The main findings of the study show that coffee mechanism six coffee-producing countries in Latin consumption has grown at an accelerated average America: Brazil, Colombia, Guatemala, Honduras, El annual rate of 6% in the last 25 years across all of Salvador and the Dominican Republic. these markets. In comparison, coffee consumption in The econometric analysis of the price the rest of the world has grown at an average annual data confirms the existence of a stable long-run rate of 2% in the same period, a rate that slowed to relationship between futures and producer prices. 1% in the aftermath of the global financial crisis of The analysis of the role of the futures market as a 2007-2008. As a result of the faster growth, the region price discovery mechanism provided mixed results. increased its share in global coffee consumption In Brazil, Colombia, and the Dominican Republic, from 5% to 12%. Furthermpre, consumer preferences local producer prices appear to incorporate new in South and East Asian emerging markets have information faster than the futures market. This can also registered significant changes, favouring the be attributed to factors such as the size of the market consumption of fresh coffee in some markets where (Brazil, Colombia), the existence of a sufficiently soluble has been traditionally consumed. This was liquid exchange in the country (Brazil), and strong the case for the Republic of Korea and Taiwan, where domestic consumption (Brazil, Dominican Republic). the peak of soluble consumption seems to have been In Guatemala and Honduras however, the New York reached, with fresh coffee consumption recording futures market indeed dominates price discovery, significant increases in the last five years. informing production and marketing decisions of coffee producers.

19. ICC-122-6. Emerging coffee markets: South and East Asia, September 2018 20. ICC-122-5. The role of the coffee futures market in discovering prices for Latin American producers, August 2018 33 Markets, statistics and economics

Ms Joahnna Gather of Georg-August-University of Gőttingen

This study is one of a new series of innovative ICO Promotion and Market Development technical papers aimed at an audience of sector The Secretariat is committed to publishing periodic specialists and researchers working in the area of reports collating information on a number of aspects applied economics of the coffee sector. To allow for of coffee production to support Members to promote replication by researchers, for example in national the quality of coffee and thus further strengthen research institutions, the study also includes a market development. During this year, the ICO detailed account of the methodology used. conducted research based on feedback from ICO Members and information received from China, to Economic and Policy Analysis for Improving inform studies on National Quality Standards22, and 23 Smallholder Coffee Producers’ Incomes Maximum Residue Limits of pesticides applicable to coffee. In accordance with Article 27 of the In order to support a study on economic and political International Coffee Agreement 2007, which sets out analysis for improving smallholder producers’ the requirement of Members to prohibit the sale and incomes, this year the ICO contributed £13,500 to advertisement of products under the name of coffee part-fund this research and continue to provide ICO if such products contain less than the equivalent of statistical data. This study is being led by Professor 95% green coffee as the basic raw material, the ICO Jeffrey Sachs of Columbia University on behalf of the also published a report on Members’ compliance World Coffee Producers’ Forum. with the provisions of this Article24. In preparation of the 122nd Session of the International Coffee Council, the ICO Statistics and Economic teams developed an internal paper on the current cycle of low coffee prices analyzing the solutions implemented by the ICO to address previous coffee price crises and new innovative ideas. This paper is now being developed to set out the Organization’s work programme to implement Resolution 465 on Coffee Price Levels21.

21. ICC Resolution 465 on Coffee Price Levels, September 2018 22. ICC-122-12. National Quality Standards, August 2018 23. ICC-122-10 Rev 1. Maximum Residue Limits, September 2018 24. ICC-122-7. Mixtures and substitutes, August 2018 34 ICO Annual Review 2017/18

Partnering for impact

To strengthen the global coffee sector and promote its sustainable expansion, the International Coffee Organization works actively with governments, non-governmental organizations and the private sector through international partnerships and advocacy.

35 Partnering for impact

This year we signed Memorandums of Understanding with the Sustainable Coffee Challenge and the International Women’s Coffee Alliance; strengthened our partnerships with the Global Coffee Platform and the African Fine Coffees Association; and continued to work more closely with international organizations

Industry events in 11 countries

36 Partnering for impact

ICO and the Sustainable Coffee Challenge To expand and enhance the coordination of public-private collaboration in the coffee sector towards a sustainable and healthy coffee community, this year the ICO signed a Memorandum of Understanding with the Sustainable Coffee Challenge (SCC), under the auspices of the Conservation International Foundation. Together, both the ICO and SCC have pledged to improve the collection, exchange, integration and dissemination of key data Ms Bambi Semroc, Vice-President of on coffee sustainability to help actors across Sustainable Markets and Strategy at the sector to better understand the need for Conservation International said: renovation and rehabilitation of coffee as well as to map spatial distribution of coffee production Such partnerships show a willingness of and forest cover in coffee-producing countries. governments to work collaboratively to Since signing the MoU in April, the ICO and ensure our ability to meet the growing SCC have collaborated on the development of the ‘Guide to Access Green and Climate Funding demand for coffee in a way that supports for the Coffee Sector: The Global Environment economic development among producers Facility (GEF)’25. Published in August 2018, this and conserves the unique tropical Guide seeks to assist governments of coffee- producing countries to access GEF funding in ecosystem in which coffee grows. order to address coffee sector challenges.

Mr Herbert Lust - Vice President Global Public Partnerships & Managing Director (Europe), Conservation International

25. ICC-122-9. Guide to Access Green and Climate Funding for the coffee sector. The Global Environment Facility (GEF): International Coffee Organization and Sustainable Coffee Challenge, August 2018

37 Partnering for impact

ICO and the International Women’s Coffee Alliance In September 2018, the ICO signed a Memorandum of Understanding (MoU) with the International Women’s Coffee Alliance (IWCA) with the aim to promote women empowerment and inclusion as a means of achieving sustainable development through social and economic progress in coffee- producing countries while protecting natural resources.

Ms Kellem Emanuele, President of the IWCA, said:

This year has been a tremendous step forward. More than global recognition of women in coffee, formal partnership with the ICO formally signifies our shared commitment to work collaboratively to achieve meaningful change, for all.

[pic]

Ms Kellem Emanuele - President, IWCA with H.E. Mr Aly Touré (Côte d’Ivoire) and Mr José Sette - ICO Executive Director

38 Partnering for impact

ICO and the Global Coffee Platform This year saw a further strengthening of cooperation between the ICO and the Global Coffee Platform (GCP), in line with the Memorandum of Understanding signed in September 2017, including: –– Collaboration on the Delta Project: Bridging the Gap in Measuring Real-Time Sustainability Performance – a joint project also with the Better Cotton Initiative and the International Further collaboration is already set in train Cotton Advisory Committee, to create a including: sustainability indicator framework to measure –– An ICO/GCP-led webinar on 1 October 2018 – progress towards the Sustainable Development International Coffee Day – on ‘Gender: From Goals, and trigger the development of value- Research to Commitment to Action’, including adding services for farmers. speakers from the International Women’s –– ICO participation in the Global Coffee Coffee Alliance and the Partnership for Gender Sustainability Conference in November 2017 in Equity, to highlight the gender gap in the coffee Geneva. supply chain and explore how to effectively –– ICO contribution to GCP Collective Action address these gaps through collaboration. Networks to push for positive impact relating in –– The ICO as a Global Event Partner, including particular to the economic viability of farming, participation in the Global Coffee Sustainability climate smart agriculture, and gender and youth. Conference and Country Platform Exchange in Brazil on 8-10 November 2018, and a Joint Sustainability Seminar during the 124th Session of the International Coffee Council in Kenya from 25-29 March 2019.

Ms Annette Pensel - Executive Director, Global Coffee Platform

39 Partnering for impact

ICO and the African Fine Coffees Association This year the ICO has continued to engage closely with the African Fine Coffees Association (AFCA) to implement the joint MOU, signed in September 2017, to promote technical and scientific cooperation with African coffee- producing countries. This has included the preparation of a number of coffee profiles on African countries including: • Ethiopia • Kenya • Rwanda • Tanzania • Uganda.

To meet with Members in African countries, but also non-Members from Africa, the ICO has actively participated in AFCA events, including the 16th African Fine Coffee Conference and Exhibition in February 2018. An ICO statistical workshop to train statisticians in African Mr Ishak Lukenge - Chairman, AFCA countries is also planned in 2019.

Coffee Global Adaptation Plan (C-GAP) This year, the ICO has continued to play an active role as a member of the Coffee Global Adaptation Plan (C-GAP) taskforce, to develop a practical approach to ensuring the ability of coffee producers to adapt to the current and future threat of climate change. The C-GAP taskforce has developed an innovative strategy that would leverage leading science and big data analytics to prioritize and coordinate public and Mr Andrea Illy - Chairman, illycaffè private sector finance, an innovative business model with the creation of a guarantee fund to significantly advance climate change adaptation across the coffee sector. To make this vision a reality, funding is now being sought from the coffee industry, international organizations and financing/donor institutions.

40 Partnering for impact

International Commodity Bodies’ Forum

In May 2018, the ICO hosted the first International Forum members were also invited Commodity Bodies’ Forum, attended by to participate in a meeting dedicated to representatives from the: presentations organized by the Common Fund • International Cocoa Organization for Commodities (CFC), attended also by the: • International Grains Council • United Nations Conference on Trade and • International Sugar Organization Development (UNCTAD) • International Rubber Study Group • Simgas BV • International Zinc and Lead Study Group • Aduna • International Nickel Study Group • Toniic • International Copper Study Group • Generation 10 • International Cotton Advisory Committee. • Open Finance UK.

As an opportunity to learn from each With a focus on new financial instruments, other, the day’s discussion centred on strategic some of which were explored in the 8th focus and priorities, administrative issues, Consultative Forum on Coffee Sector Finance communications and engagement and steps for in September 2018, this event was a productive further cooperation. and encouraging opportunity to build closer collaboration with partner organizations and In certain respects, the ICO was explore new financing mechanisms. further advanced than some commodity bodies, such as with the introduction of key performance indicators and revision of staff rules and regulations. However, there were also opportunities to learn from other ICBs, in particular the generation of income from sources other than Member contributions, such as through events, publications and statistics. Another Forum is scheduled in 2019, and work has already begun on a benchmarking exercise to identify areas for further collaboration.

41 Partnering for impact

Bilateral discussions with international organizations This year the ICO has been actively building and rebuilding links with key development players to support the coffee sector, particularly on providing access to development funding. Links have been re-established with a number of UN Organizations some of which participated in the ICO’s Donors Forum and Partnership Fair – the United National Development Programme (UNDP), International Trade Centre (ITC), United Nations Conference on Trade and Development (UNCTAD), United Nations Industrial Development Organization (UNIDO), Food and Agricultural Organization of the United Nations (FAO), the International Atomic Energy Agency (IAEA), the OPEC Fund (OFID), the United Nations Office on Drugs and Crime (UNODC) and a number of Development Finance Institutions – all with the clear purpose to advocate for the coffee sector and identify and support funding opportunities, including both grants and loans. The ICO is mandated and committed to supporting its Members to develop projects, facilitate access to funding and act as the monitoring body for the successful execution of development projects.

Representatives from just some of the ICO’s partner organizations

42 Partnering for impact

Industry events

This year the ICO has participated in a number of key international sector events:

1 Swiss Coffee Dinner: Geneva, Switzerland October 2017

2 Conference on climate change soil degradation: Bali, Indonesia October 2017

3 25th Encafé: Bahia, Brazil November 2017

4 Global Coffee Sustainability Conference: Geneva, Switzerland November 2017

5 1st Vietnam Coffee Day: Da Lat, Vietnam December 2017

6 India International Coffee Festival: Bengaluru, India January 2018 11 3 7 IACO General Assembly: Grand Bassam, Côte d’Ivoire 12 February 2018

8 16th African Fine Coffees Conference and Exhibition: Kampala, Uganda February 2018

9 UNCTAD Global Commodities Forum: Geneva, Switzerland April 2018

11 National Convention of the 12 XXII Santos International Coffee Coffee and Cocoa Chamber of Seminar: Guarujá, Brazil Peru: Lima, Peru May 2018 May 2018 13 Coffee Shop Expo: London, UK June 2018

43 Partnering for impact

10 Hosted Coffee and Sustainability, Seminar, 1st Milan Coffee Festival: Milan, Italy May 2018

13 14

1 4 9 15 10

6 5 7 8

2

14 World of Coffee Europe: Amsterdam, Netherlands June 2018

15 C-GAP Task Force (Member): Geneva, Switzerland July 2018

44 ICO Annual Review 2017/18

Outreach

The International Coffee Organization provides an important central source of objective information on the global coffee sector. We also engage actively with international educational institutions to raise the profile of coffee-related issues within the academic community, help stimulate debate and facilitate youth-led solutions to development issues in coffee-producing countries.

Library & Information The Organization offers its information services The Library of the International Coffee Organization to the coffee industry, academics, the media and has a unique collection of resources on all aspects others, answering on average 2,000 queries a year, of coffee. This year visitors and users of the Library including interviews and content on coffee trends represented a varied demographic, including and challenges to all major specialized coffee Professor Jonathan Morris from the University of magazines and the media at large across the globe. Hertfordshire, who used the Library’s collection to The ICO also provides a subscription service to inform his book ‘Coffee - A Global History’ published key publications. in October 2018.

Some of the research topics Links with universities and schools conducted by university Raising the profile of coffee-related issues within students alone included the the academic community is an important step in coffee value and supply working jointly to create an understanding of the chain, Robusta coffee, economics of coffee production, not only to ensure Indonesian coffee and its the ICO employs state of the art methods and market, as well as the role of produces high quality output, but also to provide coffee in Angolan solutions to improve the livelihoods of producers independence and civil war. as well as to manage environmental challenges in coffee production. The Library collection is available for consultation by This year ICO economists embarked on missions prior appointment: [email protected] to visit leading universities, providing campus-wide talks on the economics of coffee as well as meeting students and faculty.

45 Outreach

Dr Paul Gragl and his students from the University of London

The ongoing relationships with Georg-August During coffee year 2017/18 the ICO was also University of Göttingen in Germany and University of pleased to welcome students from the Summer California Davis Coffee Center in the United States School Module ‘Introduction to International Law’ at also provided opportunities to work jointly with Queen Mary, University of London. It was a pleasure leading academics and young scholars to produce to explain the background to the ICO, including the insightful research studies. International Coffee Agreements, current and future The ICO Secretariat has also worked with challenges facing the world coffee sector. graduate students and junior faculty on a wide array of topical research questions ranging from an assessment of the gender gap in coffee production in Ethiopia, to the role of futures markets as a price discovery mechanism for Latin American growers. The underlying empirical economic analysis relied on the wealth of statistical data collected by the ICO. In selecting research topics, the Organization was guided by requests from Members and sector stakeholders. The resulting output is often technical in nature and aimed at an audience of sector specialists and researchers working in the area of applied economics of the coffee sector. Disseminated within the research community, the studies contain a detailed account of the methodology used to allow for replication by economists, for example in national research institutions. Further collaborative studies such as an in-depth analysis of profitability in three Latin American countries are ongoing and once published will UC Davis Coffee Center contribute to reinforcing the ICO as the authoritative voice in policy relevant economic analysis.

46 Outreach

ICO Internship Programme Connecting with industry and consumers This year the ICO launched its new rolling Internship To facilitate dialogue among all actors across the programme, which provides an insight into the day- coffee value chain – not just producers and Governments to-day working environment of an international – the ICO actively engages with the roasting sector and organization. ICO interns are given the opportunity industry stakeholders, with direct links to consumers. to be part of the ICO team working on a number This year ICO Head of Operations, Mr Gerardo of topics, ranging from statistical and economic Patacconi, as a guest of the 1st Milano Coffee analysis, communication and advocacy, organization Festival in May, organized a workshop on Coffee and management of meetings and events, research and Sustainability, exploring the environmental, and preparation of reports, and the identification and economic and social impact of the coffee value chain formulation of development projects. and proposed solutions. Interns also have the chance to be exposed ICO Executive Director, Mr José Sette, led to high-level Government and private sector a session on ‘How coffee shops can make coffee representatives and international coffee experts, as more sustainable’ at the Coffee Shop Innovation Expo, well as to the work of committees or other governing attended by over 3,000 delegates from across the bodies of the Organization. industry. Internships normally last between two and The ICO has also taken the opportunity to forge six months and may be further extended up to a closer alliances with coffee associations, including maximum period of nine months. They can be carried a presentation by the Head of Operations on how out on a full- or part-time basis. Interns are selected the ICO supports coffee sustainability to the British on a competitive basis and will be based at the ICO Coffee Association’s Sustainability Committee and Headquarters, in London. Applicants should be able participation by the Executive Director and Senior to demonstrate an interest in development in the Economist in the Specialty Coffee Association’s field of coffee. They must respect the principles World of Coffee Europe. of the ICO mission and mandate and be motivated The Organization will continue to build on these by interest in interacting with people with different activities in the coming year with the implementation languages, national and cultural backgrounds – a key of Resolution 46526 on Coffee Price Levels which feature of an international organization, such as the calls on the ICO to sensitize consumers to the ICO. economic reality of the coffee sector and promote Expressions of interest in the ICO’s Internship consumption, as well as mobilizing leading roasters programme can be submitted to: [email protected] and industry stakeholders to identify solutions to address the level and volatility of coffee prices.

Meet the intern This year Ms Mayra Gomez from Honduras joined the ICO’s Internship Programme, con- ducting research in particular on national policies to alleviate the impact of low coffee prices on coffee-producing countries.

Ms Mayra Gomez with her ICO supervisor, Dr Christoph Sänger 26. ICC Resolution 465 on Coffee Price Levels, September 2018

47 Outreach

48 ICO Annual Review 2017/18

INTERNATIONAL COFFEE DAY 2018

Now in its fourth year, International Coffee Day 2018 celebrated the growing importance of women across the coffee value chain.

In addition to celebrating women in coffee, the aim The profile of International Coffee Day (ICD) continues of the event was to call on both the public and to gain momentum with Member Governments, private sectors to work together to promote the coffee associations, coffee shops and consumers empowerment of women in order to achieve gender engaging more and more, either through pledging equality and to increase productivity, supply and support or posting details of events using the hashtag sustainable consumption of coffee, particularly in a #internationalcoffeeday across social media and the climate of low prices. dedicated International Coffee Day website (www. Central to the campaign was an animation internationalcoffeeday.org). The ICD website alone video, already with over 5,000 views at the time of received details of over 100 events, large and small, writing, with a focus on the positive contribution that taking place all over the world. women play across the coffee value chain, but also To further support the campaign, the highlighting the gender productivity gap particularly International Coffee Day photo competition was held at the farm level. Supported by research in the ICO’s for the second year, with cash prizes for the winner Insight Report: Gender equality in the coffee sector27, and two runners-up. The 10 short-listed entries – female-headed coffee producing households have chosen by a judging panel, delegates at the 122nd lower yields than their male peers, due to a number Session of the International Coffee Council and over of factors including less access than men to land 2,000 online voters – are featured on the cover of ownership and quality land; full-time, managerial this Review. job opportunities; formal education and credit. Using The ICO is grateful to H.E. Ambassador animation, together with posters, postcards and Hermano Ribeiro for hosting a reception at the infographics, the key messages were that gender Brazilian Embassy in London on International Coffee inequality has no place in the global supply chain, Day in celebration of women in coffee. This event and that closing the gender gap could unlock an provided a platform, not only for the ICO to present increase in coffee production of 4 to 6.5 million its research on gender equality, but also for female 60-kg bags to meet increasing global demand. Such coffee growers and producers in Brazil to set out the measures could also bring wider social and economic obstacles and opportunities that exist for women in benefits including improved health and nutrition today’s coffee sector. for the household, helping to eradicate poverty and The ICO also extends its sincere thanks to the All increasing prosperity. Japan Coffee Association (AJCA) for their continued support for International Coffee Day, without which the campaign would not be possible.

27. ICC-122-11 – Gender equality in the coffee sector. An insight report from the International Coffee Organization, September 2018

49 International Coffee Day 2018

INTERNATIONAL COFFEE DAY PHOTO COMPETITION

Winner

First runner up Second runner up

50 ICO Annual Review 2017/18

International Coffee Agreement 2007

The work of the International Coffee Organization (ICO) is governed by the International Coffee Agreement (ICA) 2007. The objective of this Agreement is to strengthen the global coffee sector and promote its sustainable expansion in a market-based environment for the betterment of all participants in the sector.

Both exporting and importing countries can become team at the Ministry of Commerce, to explore the a Contracting Party to the ICA 2007 by depositing an procedures for China to accede to the International instrument of accession. Coffee Agreement 2007 and thus become a Member of the ICO. The ICO understands that this proposal is now Bolivarian Republic of Venezuela under consideration and will need approval at the top level of government. Over the course of coffee year 2017/18, the ICO had the pleasure to welcome the Bolivarian Republic of Venezuela as a new exporting Member of the ICO. Jamaica This brings the membership of the ICO to The ICO has been informed that Jamaica is in the 44 exporting Members and 6 importing Members. process of re-establishing its membership of the ICO and a submission has been made to the relevant Ministerial body to execute the necessary actions.

Engaging with Members Listening and acting on the priorities, needs and concerns of Members is of paramount importance to the ICO. In coffee year 2017/18, the Executive Director and senior ICO staff were on mission in a number of Member countries, including Brazil, Costa Rica, El Salvador, Honduras, India, Indonesia, Kenya, Nicaragua, Panama, Peru, Uganda and Vietnam – providing valuable

H.E. Ms Rocío Maneiro (Venezuela) opportunities to strengthen cooperation in areas such as capacity-building, technical cooperation and policy development. The next page gives a snapshot of just China some of the missions to Member countries undertaken China is a country witnessing a steep growth in coffee by ICO Executive Director, Mr José Sette. production and consumption, and will hopefully choose to become a Member country in the near future. During his mission to China this year, ICO Executive Director, Mr José Sette, met with Ms Zhao Jian, Vice Director of the Circulation Industry Promotion Center and her

51 ICO Annual Review 2017/18

52 ICO Annual Review 2017/18

Members

Our Members represent the Governments of 98% of world coffee production and two-thirds of world consumption.

Exporting countries Importing countries

53 Members

Exporting Members - 44 (As at 30 September 2018)

Angola Ecuador Madagascar Sierra Leone

Bolivia, Plurinational State of El Salvador Malawi Tanzania

Brazil Ethiopia Mexico Thailand

Burundi Gabon Nepal Timor-Leste

Cameroon Ghana Nicaragua Togo

Central African Republic Guatemala Panama Uganda

Colombia Honduras Papua New Guinea Venezuela, Bolivarian Rep. of

Congo, Dem. Rep. of the India Paraguay Vietnam

Costa Rica Indonesia Peru Yemen

Côte d’Ivoire Kenya Philippines Zambia

Cuba Liberia Rwanda Zimbabwe

Importing Members - 6 (As at 30 September 2018)

European Union Rest of world

Austria Germany Poland Japan

Belgium Greece Portugal Norway

Bulgaria Hungary Romania Russian Federation

Croatia Ireland Slovakia Switzerland

Cyprus Italy Slovenia Tunisia

Czech Republic Latvia Spain United States of America

(until 27 June 2018) Denmark Lithuania Sweden

Estonia Luxembourg United Kingdom

Finland Malta

France Netherlands

54 ICO Annual Review 2017/18

Finance & Administration

Governance and management Resources The Organization’s governance, through the ICO activities are financed by International Coffee Council, is defined in the contributions from Member Governments based International Coffee Agreement 2007. upon their average coffee exports or imports. The The Executive Director in coffee year 2017/18 total budget amounted to £2,949,133 in 2017/18, with was Mr José Sette. The Executive Director is the financial statements of the Organization audited supported by a Senior Management Team: Mr on an annual basis. Gerardo Patacconi, Head of Operations28 (from January 2018) and Mr Sean Garden, Head of Finance and Monitoring the Programme of Activities Administration. To support effective governance and closer through KPIs communication with Members, particularly in The ICO’s annual programme of activities supports between meetings of the Council, this year saw the the implementation of the Five-Year Action Plan introduction of a Permanent Secretary from the ICO 2017-2021 which sets out the overall direction and staff assigned to each Committee/Board. to address the increasing challenges faced by the coffee sector. Introducing a thematic focus The Secretariat tracks and reports on the progress of the annual Programmes of Activities The ICO also introduced an annual theme to guide and the results achieved in relation to the Five-Year the work of the Organization, not only for inter- Action Plan. This year a new reporting framework nal purposes to streamline existing resources using a set of Key Performance Indicators (KPIs) was and achieve synergies between the Secretari- endorsed, to demonstrate and evaluate more clearly at’s functions, but also externally to position the the ICO’s success in achieving its objectives and ICO as an agenda-setting organization in the cof- goals. The reporting in next year’s Annual Review will fee and wider political sector with a strategy in be based on these new KPIs. alignment with the 2030 Agenda for Sustainable Development and reporting cycle. The thematic focus for coffee year 2018/19 is Economic Sustainability.

28. Dr Denis Seudieu, Chief Economist, acted as Head of Operations from October-December 2017. Looking forward ...

The focus for our work programme for coffee year 2018/19 will be on the economic sustainability of the coffee sector, in particular the: • Implementation of Resolution 465 on coffee price levels to address the impact of low coffee prices on smallholder farmers. • Launch of the first ICO Flagship Report focusing on the economic sustainability of coffee production, providing indepth analysis, information and recommendations.

55 ICO Annual Review 2017/18

Office holders 2017/18

International Coffee Council Exporting Members: Brazil, Cameroon, Colombia, Chair: H.E. Mr Aly Touré (Côte d’Ivoire) Costa Rica, Guatemala, India, Nepal and Togo Vice-Chair: Mr Michel De Knoop (European Union) Importing Members: Japan, Switzerland and 3rd Member vacant. ICO Permanent Secretary of the Council: Mrs Sarah Friend, Secretariat and Communications Officer ICO Permanent Secretary of the Committee: Mrs Sarah Friend, Secretariat and Communications Officer Finance and Administration Committee Chair: Ms Stefanie Küng (Switzerland) Statistics Committee Vice-Chair: Dr Emmanuel Iyamulemye Niyibigira Chair: Mr Juan Esteban Orduz (Colombia) (Uganda) Vice-Chair: Ms Ina Grohmann (EU-Germany) Exporting Members: Brazil, Colombia, India, Indonesia, Uganda and 6th Member vacant Exporting Members: Brazil, Colombia, Congo Dem. Rep. of, Ghana, India, Indonesia, Nicaragua and Importing Members: European Union, Japan, Panamá Russian Federation, Switzerland and 5th Member vacant. Importing Members: European Union, Switzerland and 3rd Member vacant. ICO Permanent Secretary of the Committee: Mr Sean Garden, Head of Finance and Administration ICO Permanent Secretary of the Committee: Ms Rebecca Pandolph, Chief – Statistics Section

Projects Committee Private Sector Consultative Board (PSCB) Chair: H.E. Mr Iván Romero-Martínez (Honduras) Chair: Mr Anil Kumar Bhandari (India Coffee Trust) Vice-Chair: Ms Ina Grohmann (EU-Germany) Vice-Chair: Mr Bill Murray (NCA) Exporting Members: Brazil, Colombia, Côte d’Ivoire, El Salvador, Honduras, India, Indonesia and 8th Producer representatives Member vacant Colombian Milds: Importing Members: European Union, Switzerland Federación Nacional de Cafeteros de Colombia and 3rd Member vacant. (FNC), ICO Permanent Secretary of the Committee: Sociedad Exportadora de Café de las Cooperativas Dr Denis Seudieu, Chief Economist de Caficultores (EXPOCAFÉ), Asociación de Exportadores de Café de Colombia (ASOEXPORT), Promotion and Market Development Committee African Fine Coffees Association (AFCA) Chair: Mr Mitsuhiro Takayanagi (Japan) Other Milds: Vice-Chair: H.E. Dr Durga Bahadur Subedi (Nepal) Asociación Nacional del Café de Guatemala (Anacafé),

56 Office Holders 2017/18

Asociación Nacional de Beneficiadores y Consultative Forum on Coffee Sector Finance Exportadores de Café de Panamá (ANBEC) Chair: Mr Kirill Matrenichev (Russian Federation) India Coffee Trust (also Chair of Core Group) Brazilian and Other Natural Arabicas: Vice-Chair: : H.E. Mr Aly Touré (Côte d’Ivoire)

Conselho dos Exportadores de Café do Brasil Core Group on the Consultative Forum (2017/18 (CeCafé), and 2018/19) Associação Brasileira da Indústria de Café Solúvel Exporting Members: Brazil, Cameroon, Colombia, (ABICS), Nepal, Nicaragua, Uganda Associação Brasileira da Indústria de Café (ABIC), Importing Members: European Union, Russian Conselho Nacional do Café (CNC), Federation, Switzerland and one importing Member to be nominated in April 2018 Confederação da Agricultura e Pecuária do Brasil (CNA), Ex-officio Member: Executive Director International Women’s Coffee Alliance (IWCA) Assisted by: Chairman of PSCB, and four advisors: Ms Nancy Cheruiyot (FAST), Mr Silas Robustas: Brasileiro (Conselho Nacional do Café, Brazil), Conseil du Café-Cacao (3C), Mr Nicolas Tamari (Sucafina SA) and Dr Ralph Indonesian Coffee Exporters Association (GAEKI), De Haas (European Bank for Reconstruction and Uganda Coffee Federation (UCF) Development. ICO Permanent Secretary of the Consultative Forum and Core Group: Dr Christoph Sãnger, Senior Consumer representatives Economist All Japan Coffee Association (AJCA), China Coffee Association Virtual Screening Committee European Coffee Federation (ECF), Chair: Executive Director Institute for Scientific Information on Coffee (ISIC), Exporting Members: Brazil, Côte d’Ivoire, Guatemala National Coffee Association of USA (NCA), and Indonesia Russian Association of Tea and Coffee Producers Importing Members: European Union. (Rusteacoffee), Specialty Coffee Association World Coffee Research ICO Permanent Secretary of the PSCB: Dr Marcela Umaña, Economist

57 ICO Annual Review 2017/18

ORGANISATIONAL STRUCTURE

INTERNATIONAL COFFEE COUNCIL

Private Sector Finance and Administration Consultative Board Committee

Consultative Forum Projects Committee on Coffee Sector Finance

Promotion and Market Devel- World Coffee Conference opment Committee

Statistics Committee

58 222 Gray’s Inn Road, London WC1X 8HB, United Kingdom Tel.: +44 (0) 20 7612 0600 Fax: +44 (0)20 7162 0630 [email protected] www.ico.org @ICOcoffeeorg ICOcoffeeorg © 2019